We hit on this topic recently, but it begs revisiting (again and again) as the sheer growth in the number of Americans on food stamps continues to shock and awe.
USDA recently released December numbers for its so-called Supplemental Nutrition Assistance Program (SNAP) which show 486,503 persons added to the food-stamp rolls in December, bringing the total receiving help to more than 44 million. That’s up almost 7% just since June, and 13% compared to a year earlier. Households receiving food stamps swelled to 20.67 million, an increase of more than 263,000 in one month, and a nearly 16% increase in a year.
Compare back to a couple years ago and today’s rates of increase become even more astonishing. In 2007, average monthly participation was 26.31 million persons, so the December total represents a nearly 68% increase over the ’07 average. During the same period, the number of households receiving assistance soared 75%. That’s a startling increase, any way you look at it. Continue reading…
Think that’s expensive, lady? Just wait til next week.
No evidence that the run-up in commodities prices is soon to abate. Crude oil higher today, rice futures limit up, corn up, soy products rally and wheat up big, too.
Expect to hear more comments down the road like this one yesterday from Safeway’s (SWY) CEO Steve Burd during the company’s quarterly conference call. Responding to a question about passing on rising costs to consumers, Burd said, “we are not the only one passing along cost increases and it is not confined to the supermarket industry. And it’s called preservation.”
Catch that? It’s called preservation, he says. After at least a year of walking on eggshells over raising prices, scared that customers will just run for lower prices at the competition, businesses are collectively (“…not confined to the supermarket industry,” as Burd says) raising prices. Out of (self) preservation. Continue reading…
In what’s become a somewhat rare event lately, US stocks sold off. That’s right, nothing dramatic, mind you, but the weakness lasted wire to wire, without any convincing effort by bulls to turn this one positive. Can’t win them all.
To add a little perspective on this modest drop, both the DJIA and S&P 500 fell about one-third of a percent, and Nasdaq fell nearly 0.5%. Hardly much of a pullback, but it was the biggest point and percentage drop in twelve sessions, since the market got jittery on January 28 watching wall-to-wall coverage of protests in Egypt.
Economic data not especially inspiring, with the most notable aspects being inflation-related — hotter-than-expected import prices, and frisky gains in prices paid in NY Fed’s Empire State survey. Exxon and Chevron give back most of yesterday’s gains, and with Boeing lead the Dow’s dollar decliners. DJIA slips 41.55 points to 12226.64, and Nasdaq Comp falls 12.83 to 2804.35. S&P 500 ends 4.31 lower at 1328.01.
Housing starts, PPI, industrial production & capacity utilization and FOMC minutes all due tomorrow. Continue reading…
Another directionless premarket setup for stocks, as investors prepare to digest a burst of economic data this morning.
January retail sales, import prices and NY Fed’s February Empire State manufacturing survey all due at 8:30am ET; December business inventories and homebuilders’ Feb sentiment index set for 10:00am. Cleveland Fed’s Pianalto also scheduled to speak about economic conditions around 10:00am.
Prediction: Any better-than-expected data helps stock rally, but anything that stinks gets dismissed as skewed by bad weather.
Dell reports results after the close. FedEx profit warning late yesterday gets shrugged off, as it seems everyone saw this one coming, what with all the bad weather and soaring fuel costs. FDX actually pointed higher premarket, the spin no doubt suggesting “it could’ve been worse.” Well, the weather may get better, but don’t hold your breath on those fuel prices, citizens.
Stocks in Europe mostly higher, euro is firmer, USD index off 0.3%.
S&P futures flat; 10-yr note lower, yield at 3.65%.
Action in a couple retail stocks today could be offering some worthwhile insight into how this 4Q earnings period plays out.
Consider Williams-Sonoma and Whole Foods. WSM raised its 4Q earnings outlook this morning, citing strong holiday sales. Shares, however, are down 4%, and Newswires’ Caitlin Nish reports one analyst noting WSM didn’t raise estimates “as much as investors had almost become accustomed to,” or in other words, high expectations weren’t met.
Indeed, WSM sees 4Q EPS at 96c-98c vs prior 88c-93c view, but the Street was already at low end of the new view. And analysts also see some slowdown in sales trends vs prior the prior quarter. So, we have a stock selling off — even after the company says it’ll post at least in-line, if not upside 4Q results — because expectations ran too high. Continue reading…
A winter storm slams the east coast and leaves retailers scrambling to recover sales. But in a surprising development, natural gas prices drop as traders focus on warmer weather expected later this week. Meanwhile, the Treasury market prepares for its final auctions of the year. Brian Baskin, Deborah Lynn Blumberg and I discuss it all more on today’s edition of The Markets Hub.
Unless you’re selling snow shovels or blowers, the winter storm that blanketed the northeast hasn’t been too friendly to retailers.
Blizzard conditions have dropped more than a foot of snow in some areas on the east coast, which have wrecked havoc on air traffic, train service and left driving conditions extremely dicey. All those conditions don’t bode well for retailers who count on heavy foot traffic for significant sales on the day after Christmas. Dow Jones’ Corrie Driebusch reports:
Snowstorms hitting midwest and east coast dampen retailers’ Christmas spirits, says NPD Group. With Christmas on Saturday and Sunday lost to blizzards, retailers scrambling to recover sales. This year the day after Christmas — generally one of the biggest days of the year for shopping — “was poised to be one of the top six days of retail,” firm says. Now it warns this is likely no longer the case. Retailers may be able to recover, but it’ll take two to three weeks longer. New Years next weekend set to distract customers from shopping, too, which will deal yet another blow to retailers.
But it’s not all bad for retailers. The winter storm has given a pop to sales at home-improvement chains. Dow Jones’ Max Murphy reports Home Depot (HD) says it “saw strong demand for snow shovels, snow blowers and ice melt along the East Coast — from North Carolina to Maine.”
Home Depot shares were recently up 0.3% at $35.18.
Yesterday’s improvement in November retail sales numbers sent many hearts aflutter, leading some publications to strut about consumers opening their wallets, and their “biggest shopping spree since before the recession.” Nice, but a bit exaggerated.
Consider that CPI is up more than 5.5% since 2007, so November’s total retail & food services sales — $377.547 billion — is roughly $357.77 billion in 2007 dollars. That’s higher than sales in the months of January, February and September 2007, but still well below the $371 billion monthly average for the year.
Also insightful to look at per capita sales — the US population is up an estimated 6.42 million since 2007, so November sales in 2007 dollar terms, per capita, were about $1,162, below what would’ve been $1,186 spent per per capita back in 2007.
Indeed, spending is improving, but it’s still a little premature to pronounce the patient — in this case, the US consumer — cured.
From the anecdotal evidence department, on the heels of yesterday’s bullish November retail-sales report, we get this today from Newswires’ Caitlin Nish:
Paper and packaging companies decline on weak corrugated box shipment and inventory data. Barclays notes industry data show November box shipments up disappointing 0.1% while inventories at box plants and mills up 38,000 tons vs normal seasonal decline of 2,000. Adds containerboard prices more likely to fall than to rise over next 3-6 months. Among the decliners, Temple-Inland (TIN) off 5.9%, International Paper (IP) down 3.2%, MeadWestvaco (MWV) 3.2% lower and Packaging Corp. (PKG) off 2.8%.
So, if retail sales were so hot last month, if consumers “opened their wallets,” if people bum-rushed the malls and broke out the plastic again, then why did packaging companies in November see their shipments flat and their inventories up?
No need to answer that one right away. Just chew on it for a little while.
J.P. Morgan reported some strong earnings today. But what this bloggers eye were some of the sub-numbers in the earnings report. The bank booked $1.8 billion in investment banking fees. But don’t be fooled – that wasn’t from big M&A advising. But $429 million was in advisory fees. Instead, that $1.3 billion + remaining fees […]
David Oreck, founder of a well-known maker of vacuums and air purifiers, says he’s upset his namesake company is in bankruptcy. He says Nashville, Tenn.-based Oreck Corp. was a perfectly profitable company when he sold his stake in it to a private equity firm in 2004. He blames the firm, New York-based American Securities Capital […]